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Flight Cancellations from Latest Storm Cost Economy $95 Million

New Research Tracks Economic Impact of Cancellations, Delays.

Wednesday, March 05, 2014
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U.S. Travel Association
U.S. Travel Association

Economists at the U.S. Travel Association have concluded research finding that the cancellation of one U.S. domestic flight for weather-related reasons costs $31,600 in passengers' lost economic activity.

With major media outlets citing data from FlightAware.com that approximately 3,000 flights had been cancelled due to the latest winter weather, that translates to a total economic loss of $94.8 million.

And that number only accounts for passengers on those flights and the spending they would otherwise inject into the economy; because of discrepancies in how each carrier tabulates its costs, there is no industry-wide data available for the airline sector.

"We are now able to quantify what all travelers have long known intuitively: there are real dollar costs associated with flight cancellations and delays caused by the weather," said U.S. Travel President and CEO Roger Dow. "Obviously, Mother Nature cannot be controlled. But there are things we can do to mitigate the cost to the economy—improvements to our infrastructure that would make weather events far less disruptive to our air travel system.

"This data is just the latest indication that, as a country, we need to prioritize our infrastructure to make sure our economy can withstand these shocks to the system. More investments are, quite simply, essential."

Dow said modernizing airports and air traffic control equipment could help reduce flight delays and cancellations during inclement weather. For example, NextGen technology allows pilots and air traffic controllers to land planes using GPS navigation, rather than radar and plain-sight, and can reduce flight delays and cancellations caused by poor visibility. Additional runways, aprons and deicing facilities can increase the number of airplanes that can land and take off in poor weather conditions, including snowstorms.

U.S. Travel's research also determined that every hour a flight is merely delayed, as opposed to cancelled outright, costs the U.S. economy an average of $3,300 in passenger-related economic activity.

All told, the direct economic impact of flight cancellations and delays cost the economy $3.5 billion in 2013.

The direct-impact figure includes the costs of canceled trips, passenger time lost, missed connections and missed travel activities. The estimates are based on a combination of airline traffic and on-time data; air traveler behavior and characteristics data recently collected through U.S. Travel surveys; the monthly TravelsAmerica survey conducted by research firm TNS; and U.S. Travel's proprietary economic models.

In weeks ahead U.S. Travel aims to incorporate the new research into an online calculator to determine the economic impact of delays and cancellations that are reported by the media during weather events and other disruptions.

The U.S. Travel Association is the national, non-profit organization representing all components of the travel industry that generates $2.0 trillion in economic output and supports 14.6 million jobs. U.S. Travel's mission is to increase travel to and within the United States.
Visit www.ustravel.org.

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